Economic Forecasting
Feb. 26th, 2023 07:54 pm![[personal profile]](https://www.dreamwidth.org/img/silk/identity/user.png){kind=small}
ndrosenI have said it before, but I will repeat it for any readers who may be forgetful, and for any new people coming across my weblog: back in 1997, the late Dr. Fred Foldvary published an article in the American Journal of Economics and Sociology predicting the Great Recession of 2008, and explaining why it would occur, namely, as a result of the bursting of a speculative bubble in land prices. He also predicted another major recession for 2026 or so, I think in that article, and definitely in presentations at Georgist conferences years later.
There were concerns about a recession expected for 2023, given the inverted yield curve for bonds, and the the extraordinarily high price to earnings ratio of stocks. That may be, or perhaps we will be spared for now; I do recall reading that the latest unemployment news was good, with a lower unemployment rate than we have had in decades. Be that as it may, land prices cannot keep increasing forever, so if the eighteen year real estate cycle holds good, we may expect another major crash around 2026. I recommend keeping this in mind when making decisions about buying a home or other real estate, keeping a financial cushion for emergencies, and other matters of personal finance.
I also point out that if Dr. Foldvary could make economic predictions many years in advance using his Georgist-Austrian synthesis, and foresee what conventional economists could not, there may be good reason to study Georgist economic thought, and lobby your elected representatives to apply it.
There were concerns about a recession expected for 2023, given the inverted yield curve for bonds, and the the extraordinarily high price to earnings ratio of stocks. That may be, or perhaps we will be spared for now; I do recall reading that the latest unemployment news was good, with a lower unemployment rate than we have had in decades. Be that as it may, land prices cannot keep increasing forever, so if the eighteen year real estate cycle holds good, we may expect another major crash around 2026. I recommend keeping this in mind when making decisions about buying a home or other real estate, keeping a financial cushion for emergencies, and other matters of personal finance.
I also point out that if Dr. Foldvary could make economic predictions many years in advance using his Georgist-Austrian synthesis, and foresee what conventional economists could not, there may be good reason to study Georgist economic thought, and lobby your elected representatives to apply it.
